Kris and Bruce. The Hamms. The “Ezras.” For devotees of Divorce Styles of the Rich and Famous, this is shaping up as quite a week.
Beyond the water-cooler buzz and the cocktail-party schadenfreude, though, is there any reason to pay attention to all this trouble in paradise?
“While I’m sure that the litigants would happily do without the negative publicity … their cases often provide divorce financial professionals like me with opportunities to illustrate certain points,” Jeff Landers blogged Monday on Forbes.com.
Landers was referring specifically to the divorce of Oklahomans Sue Ann Hamm and Harold Hamm, founder of Continental Resources, a major leaseholder in the shale fields of Bakken, North Dakota.
“With more than $17 billion reportedly at stake, their case is shaping up to be the largest divorce settlement in history,” Landers wrote. His “teachable moments” involve the importance of two issues that go into an equitable distribution of marital assets: “1) active vs. passive appreciation of property and 2) the Date of Separation.”
Oklahoma, like Maryland, is an equitable distribution state — but the DOS is reportedly just as important to Kris Jenner out in California, since it controls just how much of her earnings from managing her famous daughters will be considered community property.
And consider this tidbit from the fan site Radar Online:
[T]he pair have already hashed out a settlement to divide up their $225 million fortune. Even though the former reality couple had no prenuptial agreement, ‘For years, their finances had been kept separately,’ a family insider tells Radar.
Now, obviously, the “family insider’s” quote could not be verified, but that’s beside the point. Separate checkbooks after the wedding are no substitute for a prenup, but they might just make any future breakup a little less messy.
Continuing our descent down the asset ladder, we have “the Ezras” — Lee Kian Soo and his ex-wife Goh Gaik Choo, the co-founders of Ezra Holdings Ltd., an offshore marine services company based in Singapore. As reported by Bloomberg, the former couple and their son, Lionel, this week reached a confidential settlement to resolve their six-year legal battle over marital assets of $164 million.
Perhaps the real lesson behind the Ezras’ divorce comes not from the settlement, which is confidential, but from the gravamen of Goh’s dissipation claim. After she left in 2008, Goh alleged, Lee transferred a significant chunk of Ezra stock to Lionel at 45 cents a share —never mind that the market price in 2009 and 2010, when the transfers occurred, was roughly three to four times that amount. Lee explained he chose the price because he was born in 1945.
The Singapore High Court didn’t buy that explanation, either, Bloomberg reported. In January, the court ordered a substantial payment from Lee to Goh but denied her the plea for monthly maintenance. The settlement resolves both sides’ appeal.
The lesson? Be reasonable, or at least make some attempt to look like you are.
Solace for a broken art
Finally, for the merely well-to-do, we have this from the Wall Street Journal:
Of all the fights that can erupt during divorce proceedings or when a family member leaves behind a large estate, some of the biggest take place over the artwork.
Emotional attachments to art can outweigh financial considerations, the journal’s sources say. They suggest taking a detailed inventory of all the art the spouses have bought, kept or sold, when and at what price; getting appraisals; and deciding, in advance, how to act on those appraisals. They also suggest being scrupulously honest, as anything less could be construed as an attempt at fraud.
And one last lesson/tip you can impart to your clients — this one from Ike Vanden Eykel, an attorney based in Dallas, Texas.
“You don’t want to leave things up to a judge to decide,” Vanden Eykel told the journal, “because the court will only order that everything be sold.”